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Determinants of Household Saving in Australia

Author

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  • Mark N. Harris
  • Joanne Loundes
  • Elizabeth Webster

Abstract

This paper uses a unique survey of consumers to test several separate but inter‐related hypotheses of household saving. Unit records from 17,585 Australian households are available, which enables the incorporation of a range of household characteristics that may be important factors for saving behaviour, but which are not typically available to researchers undertaking macroeconomic analyses. An ordered probit estimation method is used, and the results support the view that current incomes are perhaps the most important determinant of saving. However, it can also be seen that demographics and householders level of economic optimism play a key role.

Suggested Citation

  • Mark N. Harris & Joanne Loundes & Elizabeth Webster, 2002. "Determinants of Household Saving in Australia," The Economic Record, The Economic Society of Australia, vol. 78(241), pages 207-223, June.
    • Handle: RePEc:bla:ecorec:v:78:y:2002:i:241:p:207-223
    DOI: 10.1111/1475-4932.00024
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    Cited by:

    1. Alexandru-Mihai BUGHEANU & Ruxandra DINULESCU & Florin PUCHEANU, 2021. "Empirical Study On Alternatives For Saving And Investing In The Postpandemic Period. Case Study: Romania," Business Excellence and Management, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 11(5), pages 27-40, October.
    2. Lucía Rey-Ares & Sara Fernández-López & Milagros Vivel-Búa, 2018. "The Influence of Social Models on Retirement Savings: Evidence for European Countries," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 136(1), pages 247-268, February.
    3. Jorge Tovar M., 2008. "Caracterización del ahorro de los hogares en Colombia," Coyuntura Social 12852, Fedesarrollo.
    4. Clovis Kerdrain & Isabell Koske & Isabelle Wanner, 2011. "Current Account Imbalances: can Structural Reforms Help to Reduce Them?," OECD Journal: Economic Studies, OECD Publishing, vol. 2011(1), pages 1-44.
    5. Orbeta, Aniceto Jr. C., 2006. "Children and Household Savings in the Philippines," Discussion Papers DP 2006-14, Philippine Institute for Development Studies.
    6. María del Carmen Valls Martínez & José Manuel Santos-Jaén & Fahim-ul Amin & Pedro Antonio Martín-Cervantes, 2021. "Pensions, Ageing and Social Security Research: Literature Review and Global Trends," Mathematics, MDPI, vol. 9(24), pages 1-25, December.
    7. Canova, Luigina & Rattazzi, Anna Maria Manganelli & Webley, Paul, 2005. "The hierarchical structure of saving motives," Journal of Economic Psychology, Elsevier, vol. 26(1), pages 21-34, February.
    8. Ethan Hunt & Dr. Hyungjoon Jeon & Dr. Sang Lee, 2021. "Determinants of Household Savings: An Empirical Evidence from the OECD Member Countries," Business and Economic Research, Macrothink Institute, vol. 11(2), pages 62-75, June.
    9. Glenn Abela & William Gatt, 2021. "Saving behaviour in Malta: Insights from the Household Budgetary Survey," CBM Working Papers WP/02/2021, Central Bank of Malta.
    10. Montserrat Guillen & Miguel Santolino & Xenxo Vidal-Llana, 2022. ""Inequality of subjective economic uncertainty and individual economic prospects in the pandemic period"," IREA Working Papers 202202, University of Barcelona, Research Institute of Applied Economics, revised Feb 2022.
    11. Dmitry Kulikov & Karsten Staehr, "undated". "Microeconometric analysis of household saving in Estonia: income, wealth, financial exposure," Bank of Estonia Working Papers wp2007-8, Bank of Estonia, revised 03 Feb 2015.
    12. Xueyan Zhao & Mark Harris, 2004. "Modelling Tobacco Consumption with a Zero-Inflated Ordered Probit Model," Econometric Society 2004 Australasian Meetings 363, Econometric Society.
    13. Tim Fry & Sandra Mihajilo & Roslyn Russell & Robert Brooks, 2008. "The Factors Influencing Saving in a Matched Savings Program: Goals, Knowledge of Payment Instruments, and Other Behavior," Journal of Family and Economic Issues, Springer, vol. 29(2), pages 234-250, June.
    14. van der Star, Sanne M. & van den Berg, Bernard, 2011. "Individual responsibility and health-risk behaviour: A contingent valuation study from the ex ante societal perspective," Health Policy, Elsevier, vol. 101(3), pages 300-311, August.
    15. Fentahun Addis & Belainew Belete & Melaku Bogale, 2019. "Rural Farm Household Saving Habit in Ethiopia: Evidence from South West Amhara Growth Corridor," Academic Journal of Economic Studies, Faculty of Finance, Banking and Accountancy Bucharest,"Dimitrie Cantemir" Christian University Bucharest, vol. 5(3), pages 112-119, September.
    16. Duval, Romain & Furceri, Davide & Tovar Jalles, João, 2022. "Labor and product market reforms and external Imbalances: Evidence from advanced economies," Journal of International Money and Finance, Elsevier, vol. 121(C).
    17. Swati Prasad & Ravi Kiran & Rakesh Kumar Sharma, 2021. "Examining saving habits and discriminating on the basis of demographic factors: A descriptive study of retail investors'," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(2), pages 2859-2870, April.
    18. Levenko, Natalia, 2020. "Perceived uncertainty as a key driver of household saving," International Review of Economics & Finance, Elsevier, vol. 65(C), pages 126-145.
    19. Clovis Kerdrain & Isabell Koske & Isabelle Wanner, 2010. "The Impact of Structural Policies on Saving, Investment and Current Accounts," OECD Economics Department Working Papers 815, OECD Publishing.
    20. Agyekum, Francis & Locke, Stuart & Hewa-Wellalage, Nirosha, 2016. "A search for Theory of Financial Market Failure in Lower Income Countries (LICs) and implication for Financial Exclusion," MPRA Paper 82861, University Library of Munich, Germany, revised 15 May 2017.
    21. Dominika Maison & Marta Marchlewska & Katarzyna Sekścińska & Joanna Rudzinska-Wojciechowska & Filip Łozowski, 2019. "You don’t have to be rich to save money: On the relationship between objective versus subjective financial situation and having savings," PLOS ONE, Public Library of Science, vol. 14(4), pages 1-15, April.
    22. Zsófia Pintér & Katalin Tóth & Tibor Bareith & József Varga, 2021. "The Relationship between Decision and Payment Habits and Its Relation with Wasting—Evidence from Hungary," Sustainability, MDPI, vol. 13(13), pages 1-13, June.

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